Bad News for Nominee Land Ownership

(3/15/2015) Bad News for Nominee Land Ownership

Agrarian Minister and National Land Agency Chief says foreigners owning land will have their lands nationalized

The Minister of Agrarian Affairs who is also the head of the National Land Agency (BPN), Ferry Mursyidan Baldan, told that his office will soon survey and inventorying land “owned” by foreigners in Indonesia.

“It is absolutely not allowed for foreigner to own a single inch of land in Indonesia. This is as stipulated by the National Constitution,” said Ferry afterwards.

The Minister’s comments were also reported by the State News Agency Antara.

The survey and inventorying of land “owned” by foreigners, according to Ferry, must be done to verify that there is no land in Indonesia controlled by foreigners.

“According to international law, only the home of a foreign ambassador and the Embassy can be owned by foreigners (in Indonesia),” he said.

The Minister said there is a great deal of land in Indonesia, particularly in tourism areas such as Bali and Lombok, that it owned (illegally) by foreign nationals.

In Bali and Lombok many foreigners control land through nominee landowners, using legally questionable powers of attorneys and fictive mortgage agreements. The Minister’s statement has many in the property sector concerned that land could be confiscated by the State or documents used to establish illegitimate foreign control of land declared invalid. The latter could create a windfall for the nominee who would then be established as the sole and rightful owner of the land.

When Ferry was asked what sanctions can be imposed on foreign nationals known to illegally own land in Indonesia, the Minister replied “there is no sanction.”

“There’s no need for sanctions, we will just divert possession of the land. We will ask if he has an Indonesian wife and divert the land to her. But, if he doesn’t have an Indonesian wife, then the land will be taken by the State,” Ferry explained.

He assured that the coming survey and inventorying of land ownership thought to be “owned” by foreigners will be done in an orderly manner. “This will not be done in a half hazard way. We are doing surveys (in such a way) as to avoid creating an uproar. We are inventorying, not conducting raids. So there is no need for anyone worrying or being frightened."